Confused by Pensions

I have been awarded a pension sharing agreement by ex, he has five pensions that are frozen, they total £51,926, I would like to stay in the different schemes as I don't have a pension of my own and am not working, one of the letters from the pension companies has asked if I want to transfer the pension credit to one of their plans the options are:

a Stakeholder Plan
or
a Pension Annuity Plan

can someone please explain, in very simple terms the pros and cons of each.

Hi,

I have set out some initial thoughts on your post which I hope will add some value. I have assumed that you have discounted offsetting and pension attachment. The other options to pension sharing.

I have also included a very brief description of the differences between stakeholder pensions and annuities as well.

Although you have agreed to share all 5 pensions it may not be advisable to actually share all 5. This is because there could be 5 separate charges levied by the pension providers for implementing the orders.

Consider reviewing the pensions and sharing one or two in their entirety (up to the overall value of the share).

In addition, each pension will not be like for like and there could be benefits associated which are more valuable to you or to your ex. There also could be other costs to sharing the pensions in terms of penalties. The merits of each pension should be individually reviewed.

Stakeholder - low cost pension arrangement which will hold your pension share up until the point you decide to take the benefits from it. (NB. from age 50 up until 5 April 2010 - age 55 after).

Annuity - the actual income you will receive when the value of your pension pot is exchanged when you decide to take the benefits.

In effect, the pension company is asking you - do you want your pension now (annuity) or later (Stakeholder until retirement then annuity).

There is a lot more to it but I have tried to really condense this bit. I hope this helps.

Please note: Although I am a Resolution Accredited Independent Financial Adviser my comments are given here as general guidance ­­­­­base­­­­­d on the (often limited) information available and does not constitute financial advice. They should not be seen as a substitute for detailed financial and legal advice.